UltraTech's strong operational performance in Q1 enthuses the street

Better-than-expected realisations and lower costs led to improvement in per-tonne profitability

India’s largest cement maker, UltraTech, impressed the Street with its June quarter operational performance. The stock gained over 7 per cent in trade on Tuesday.  While demand was affected by the lockdown, the company reported a strong beat on the operating profit front, propped up by savings on costs, lower raw material prices, and robust realisations. Though ACC, the other pan-Indian player, also reported a steady performance, UltraTech’s showing was better and was led by superior per-tonne profits and overall improvement.

UltraTech’s reported Ebitda/tonne of Rs 1,416 at the consolidated level was much better than Rs 1,385 in the year-ago quarter